Finally the government is heeding some warnings about the consequences of staring at the international recession as it hits the economy. I am on record in inviting the government to start sitting down with ailing exporting industries since late last year as NSO statistics showed a consistent downturn in exports. The finance minister has so far unveiled two instances where, apparently, the government has intervened with undisclosed financial packages to try to salvage two export oriented companies that were threatening to shed jobs because of lack of orders.

So, contrary to what the Prime Minister and his Finance Minister have been gloriously assuring us during the last few months, the budget alone is not sufficient to cushion the country from the effects of the international recession. More must be done. Indeed the two financial packages announced so far vindicate what the opposition has been saying all along. Take action or be damned.

Incidentally, last Wednesday the Prime Minister re-stated in Parliament his firm belief that the last budget is the sole stimulus provider required to fend off the negative impact of the recession. He was saying so with a straight face while his Finance Minister was at that very moment in time paying out undisclosed thousands of euros to another company in serious trouble. Lawrence Gonzi has taken up the habit of wearing two hats. On the one hand he supports his budget while on the other he forks out more money than his budget estimates provide. Are we supposed to believe him when he says that his budget is the country’s salvation?

It is good that the government seems to have finally started to act, a bit late in the day but anyway better late than never. However I must quickly point out that other companies, besides the mentioned ones, are in dire need of a stimulus, particularly those in the tourism sector which accounts to thousands of jobs. The tourism industry is passing through one of its most difficult and trying phases and the recession will have a telling impact on our industry as we move closer to the summer months.

The Prime Minister was sounding buoyant about the fact that other economies abroad are taking the full brunt of the recession while locally only the smaller waves have been pounding our export oriented industries so far. But he now seems to be taking a completely different view of the current circumstances. The money expended to save the two ailing industries did not fall from the skies. Indeed the Finance Minister admitted that the money was above the government’s expenditure forecasts in the budget. So while the budget cannot be entirely relied upon to sail this country through the storms, it is also clear that the day of reckoning has arrived and that the economy is no longer as resilient as our ministers would like to make us believe.

It is clear that the government has opted for a micro-approach towards safeguarding industry and jobs, preferring to engage in face-to-face dialogue with troubled companies, singling them out and providing financial relief on an ad hoc basis. This involves a selective process that, it seems, will be exclusive of companies that, in government’s judgement, are in trouble for reasons unrelated to the international recession.

How the government is gauging companies only God knows as the process is shrouded in mystery and lack of transparency. By citing confidentiality, it is clear the government doesn’t want to have a run at its finances by ailing industries as news start breaking that financial packages are being distributed around. But it will not manage to stop word from spreading as news of assistance has already reached the commercial community.

It is also unclear whether the government is trying to keep a low profile on these financial packages because in reality it is more concerned about its ailing public finances and burgeoning deficit than about salvaging the economy.

So far the government seems to be more interested in salvaging jobs at the bigger, industrialised and export oriented companies. But SMEs and sole traders are also feeling the pinch through the indirect effects of the international recession and induced government costs like the hike in utilities rates. It will be difficult for the government to adopt a micro-economic approach for them all because of the large numbers and might have to adjust to a more macro-approach sooner than later as the recession deepens.

One still has to see if the government just wants to look like it is doing something about the current crises. Or has the government opted for a selective process because its finances do not permit it to do much more? Time will tell.

Dr Gavin Gulia is the opposition’s main spokesman on the economy and the self-employed